Rex Trueform - Update On Proposed Closure Of The Salt River Factory
REX TRUEFORM CLOTHING COMPANY LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1937/009839/06)
Share codes: RTO, RTN and RTOP
ISIN NUMBERS: ZAE000006144, ZAE000009700 and ZAE000006151
(`Rex Trueform` or `the company`)
UPDATE ON PROPOSED CLOSURE OF THE SALT RIVER FACTORY
Rex Trueform shareholders were informed in the profit announcement for the six
months ended 31 December 2005 published on 3 March 2005 (`the results
announcement`) that given further deterioration in the business environment, the
company was compelled to consult with its trade union and other employee
representatives over the future of the Salt River tailoring facility.
It was noted in the results announcement that production volumes at the Salt
River factory had been severely compromised by the strong rand which had
mitigated against obtaining exports at viable prices, a surge in imported
garments from countries with low cost inputs and a shift in consumer
preferences. As a result of the above the Salt River factory was no longer
viable and could not be allowed to be a financial drain on the other group
operations.
Since March, the company has been involved in extensive consultations with the
South African Clothing and Textile Workers Union, other employee representatives
and a task team representing the Western Cape government regarding the proposed
retrenchments at the company`s Salt River factory.
Negotiations have also taken place with a BEE consortium and the directors have
indicated their willingness to offer attractive terms for the lease of the Salt
River buildings and equipment for continued operations. Discussions continue in
this regard.
The remaining operations in the company being the Queenspark retail chain and
the Atlantis factory are both viable and profitable. The company has a strong
balance sheet and cash reserves are currently above the levels reflected in the
June 2004 and December 2004 balance sheets.
A further announcement will be published once the impact and the outcome of the
aforementioned negotiations and discussions is known.
Cape Town
24 May 2005
Sponsor
Nedbank Capital
Date: 24/05/2005 10:45:17 AM
Produced by the JSE SENS Department
Profile Group (Pty) Ltd. has taken care in preparing all information on this website, but does not accept any liability for errors or out-of-date information.
